The founder of one of the Middle East's biggest foreign currency providers is in talks to buy Travelex in a deal that would result in the abandonment of a £1bn London initial public offering (IPO).

Sky News can reveal that Travelex is in advanced talks with Dr Bavaguthu Shetty, the boss of UAE Exchange, about a sale that would value the British-based company’s equity and debt at between £800m and £1bn.

The discussions could yet falter, but insiders said on Thursday that a deal could be announced within days if they progress as expected.

If the takeover negotiations do collapse, Travelex would move quickly towards formally announcing a stock market listing, a source said.

A sale would crystallise major windfalls for both Apax Partners, the private equity firm which bought a controlling stake in Travelex in 2005, and Lloyd Dorfman, Travelex’s founder.

UAE Exchange is a major payments processing business which also operates a money transfer service under the name Money2Anywhere.

People said that Dr Shetty, a billionaire entrepreneur, was keen to acquire Travelex because of the UK company's extensive retail network and broad international corporate client base.

UAE Exchange is understood to employ more than 9000 people in around 40 countries, and remits $36bn (£21bn) to India each year.

It also operates a brand called Xpress Money which has 100,000 locations in 136 countries, according to the company’s website.

The prospect of an imminent sale was reported on Wednesday by Bloomberg News.

Travelex was set up in 1976 by Mr Dorfman, who remains its chairman and second-largest shareholder.

One of Britain's most successful entrepreneurs, he would remain as chairman if the company opts for a listing rather than a sale to Dr Shetty.

Travelex has a network of 1,500 stores and 1,250 ATMs in 27 countries around the world.

Goldman Sachs is understood to have been advising Travelex on sale discussions, with American Express and HNA, a Chinese group, also having expressed an interest.

Rothschild was brought in last autumn to help evaluate options for the business.

A stock market listing would probably have seen Travelex join the FTSE-250 index of the public companies ranked between 101 and 350 by size on the London markets.

Travelex has been reshaped since Peter Jackson, its chief executive, was recruited from Lloyds Banking Group in 2010, with the sale of its card management and global payments operations for an aggregate total of nearly £1bn.